Low-Cost Carriers route network development
Marina Efthymiou, Panayotis Christidis
Annals of Tourism Research
Business School

Airline liberalisation and deregulation was a milestone for the growth in civil aviation activity. The most successful business model occurring from airline deregulation in Europe is the Low-Cost Carrier. They offer a basic, very competitively priced scheduled service, usually out of regional airports on a point-to-point basis. Low-Cost air carriers achieve economies of scale by deploying large, single-model fleets across a set of regional bases which they expand over time. The addition of new bases and routes is bound by profitability and operational aspects, both posing limitations to the travel demand that can be served. 

Ryanair is the most recognisable Low-Cost Carrier in Europe and is the outcome of a radical business transformation. It serves a variety of destinations ranging from city breaks in mainland Europe to summer holiday island locations.

The team explored the evolution of Ryanair's network and discussed the factors that influence the airline's choices. Using highly detailed information on the evolution of the fleet and routes,they calculated suitable indicators for the quantification of the trends. Based on these observations, we explored the implications for travel and tourism. The analysis was supported by interviews with industry experts. The main conclusion is that there is bi-directional causality between airline network evolution and travel demand.